Smart Contracts and Trade Negotiations
Every athlete in every league, professional or amateur, must sign a contract. The contract outlines everything from their salary and perks, to behaviour guidelines and appearance requirements. These contracts determine athletes lives on and off the field of play, making this process extremely important to them. Meanwhile, a club has to sign anywhere from ten to more than fifty athletes a season.
When going through the process of signing athletes to their roster a club has to negotiate with many different agents, manage different departments, and make sure each decision will allow the club to put the best possible team on the field at the beginning of the season.
CURRENT PROCESS →
Depending on the league, teams require either traditional paper contracts that are typically faxed between clubs, agents and athletes; or DocuSign, a digital version of the paper contract emailed between clubs, agents and athletes. Both processes are inefficient and require a great deal of time and energy to consolidate changes. The team manager must cross-check each contract change as it comes in against their salary cap, other athletes, and what they know about that athlete (their game stats, injury history, etc). This information is typically stored in different siloed spreadsheets and databases.
The process is further complicated when a club is ready to trade an athlete. Typically trades, especially around a trade deadline, can take hours on hours of a GM’s time, as they negotiate last minute with other teams to trade athletes. Then those contracts need to be written, agreed upon by the two teams, the athlete and the athlete’s agent. Finally, the contract has to meet the trade rules and regulations as set out by the league.
Basically, the contract negotiations never stop for a General Manager.
THE SOLUTION →
“What blockchain is doing is creating a multi-party business process that is moving out of email, phone calls, spreadsheets and into a single system with a single view on the data that all the participants can rely upon and trust,”
- Matt Kerner, Microsoft Azure
By uniting athlete data into one secure application, and breaking down barriers between data silos, General Managers will be able to see a complete athlete profile comprised of scouting information, game statistics, and injury information that is verified and reliable as the system constantly cross-checks and validates the data.
Through Smart Athlete Management (SAM), smart contracts built into the system can access all this athlete data, and the General Manager can communicate directly with the athlete and his or her agent, as negotiations and changes are made to contracts. The GM would no longer have to review and confirm across multiple spreadsheets.
Redundancies are eliminated as the smart contracts are constantly validating and updating the information. Until all parties agree, the contract will highlight where the disagreements lie. Once it is locked in, the club, agent and athlete can sign the contract from their desktop or phone, without needing to find a fax machine or be on location.
After the contract is signed it is also able to execute without external interference ie. an accountant on clauses and bonuses as they arise, by validating and cross-checking information on the internet, in internal systems, and databases. The smart contract can check thousands of information sources in seconds, and execute the contract terms automatically and instantaneously.
By using smart contracts, the club, agents and athletes can bring their contract negotiations into the future. Clubs will have efficient real-time contract negotiations and automated execution of contract terms. Therefore, they can eliminate back end redundancies, and spend more time on the areas they love: winning games!
Interested in learning more? Schedule a demo today!